BETHESDA, Md.--(BUSINESS WIRE)--ProShares, a premier provider of alternative ETFs, today announced the launch of the ProShares Morningstar Alternatives Solution ETF (ALTS). ALTS is the only ETF based on a Morningstar index comprising a broad range of alternative strategies. When added to a traditional stock and bond portfolio, ALTS is designed to enhance risk-adjusted returns.
“As the popularity of alternative investments grows, many investors struggle with how to incorporate these strategies in a portfolio,” said Michael L. Sapir, Chairman and CEO of ProShares Advisers, LLC. “We are thrilled to collaborate with Morningstar to provide an alternatives solution that can help investors build better portfolios.”
“ProShares has one of the broadest suites of alternative ETFs,” said Sanjay Arya, head of Morningstar Indexes. “Creating an index that provides diversified exposure to alternative strategies aligns with Morningstar’s goal of helping investors achieve better outcomes.”
The Morningstar® Diversified Alternatives IndexSM is based on the asset allocation and construction expertise of Morningstar and its subsidiary Ibbotson Associates. The index allocates among a diversified set of ProShares alternative ETFs covering strategies including hedge fund replication, long/short equity, merger arbitrage, managed futures, breakeven inflation, infrastructure and listed private equity. Morningstar dynamically adjusts the base allocation by applying a tactical momentum signal based on price trends over time in each underlying ETF.
For at least the first two years following the launch of the ProShares Morningstar Alternatives Solution, all investment advisory and management service fees will be waived.1
ProShares offers the nation's largest lineup of alternative ETFs. We help investors to go beyond the limitations of conventional investing and face today's market challenges. ProShares helps investors build better portfolios by providing access to alternative investments delivered with the liquidity, transparency and cost effectiveness of ETFs. Our lineup of 150 alternative ETFs can help you reduce volatility, manage risk and enhance returns.
1Until at least October 31, 2016, ProShare Advisors will waive all of its investment advisory and management service fees. Total expenses, including acquired fund fees, will also be capped at 95 basis points. The estimated gross expense ratio is 1.24, as shown in the most recent prospectus.
Investing involves risk, including the possible loss of principal. ProShares ETFs are generally non-diversified and each entails certain risks, including risk associated with the use of derivatives (swap agreements, futures contracts and similar instruments), imperfect benchmark correlation, leverage and market price variance, all of which can increase volatility and decrease performance. There is no guarantee any ProShares ETF will achieve its investment objective.
ALTS is a fund of ETFs that is designed to track the performance of the Morningstar® Diversified Alternatives IndexSM, which allocates primarily among underlying ETFs that are affiliated with the Advisor. This may create potential conflicts of interest. An investment in ALTS will entail more direct and indirect costs and expenses than a direct investment in the underlying ETFs. The underlying ETFs may include ETFs that are not investment companies regulated under the Investment Company Act of 1940 and are not afforded its protections. ALTS allocates among a set of underlying ProShares ETFs that employ alternative and non-traditional strategies such as long/short, market neutral, managed futures, hedge fund replication, private equity, infrastructure and inflation-related investments. ALTS is subject to the investing risks of these underlying ETFs to the extent it allocates to them. For more on specific risks related to these underlying ETFs, please see the summary and full prospectuses for ALTS and the underlying ETFs. There is no guarantee that ALTS will produce high or even positive returns, or that it will enhance risk-adjusted portfolio returns when combined with traditional investments. Short positions lose value as security prices increase. Leverage can increase market exposure and magnify investment risk. Investments in smaller companies typically exhibit higher volatility. International investments may involve risks from: geographic concentration, differences in valuation and valuation times, unfavorable fluctuations in currency, differences in generally accepted accounting principles, and from economic or political instability. In emerging markets, all these risks are heightened, and lower trading volumes may occur. There are additional risks related to commodity investments due to large institutional purchases or sales, and natural and technological factors such as severe weather, unusual climate change, and development and depletions of alternative resources.
Carefully consider the investment objectives, risks, charges and expenses of ProShares before investing. Read them carefully before investing. This and other information can be found in their summary and full prospectuses. Obtain them from your financial advisor or broker/dealer representative or by visiting ProShares.com.
The “Morningstar® Diversified Alternatives IndexSM” is a product of Morningstar, Inc. (Morningstar) and has been licensed for use by ProShares. ProShares have not been passed on by Morningstar or its affiliates as to their legality or suitability. ProShares based on the Morningstar Diversified Alternatives Index are not sponsored, endorsed, sold or promoted by Morningstar or its affiliates, and Morningstar makes no representation regarding the advisability of investing in ProShares. MORNINGSTAR AND ITS AFFILIATES MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO PROSHARES.
ProShares are distributed by SEI Investments Distribution Co., which is not affiliated with the funds' advisor or sponsor. © 2014 PSA 2014-5370